DEFINITION of 'General Public Distribution'

A type of primary market offering in which the securities being issued are available to anyone who has the ability to purchase them. This differs from conventional public distributions of securities in which underwriting investment banks sell large blocks of the issued securities to large investors.

BREAKING DOWN 'General Public Distribution'

If you take part in a general public distribution of securities, you are participating in what is called the primary market: you are buying securities directly from the issuing company, and your funds go to it to finance its business activities. This is in contrast to the secondary market, where investors buy and sell securities from each other, with funds moving back and forth from investor to investor without involving the underlying company at all.

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RELATED FAQS
  1. Who trades in primary and secondary capital markets?

    Understand how primary and secondary markets function in the trade of financial securities between investors, and learn how ... Read Answer >>
  2. What is the average range for the price-to-earnings ratio in the electronics sector?

    Understand the difference between the primary market and the secondary market, and learn which investors are able to participate ... Read Answer >>
  3. Who facilitates buying and selling on the primary market?

    Learn more about the primary marketplace -- home of initial public offerings -- and the major players that make buying and ... Read Answer >>
  4. When you buy a stock in a company, does it necessarily mean that one of the shareholders ...

    There are two main markets where securities are transacted: primary and secondary. When stocks are first issued and sold ... Read Answer >>
  5. Do underwriters make guarantees to sell an entire IPO issue?

    Underwriters represent the group of representatives from an investment bank whose main responsibility is to complete the ... Read Answer >>
  6. After an initial public offering, does a company profit from increases in its share ...

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